HCA Midwest Health to pay additional $15M to settle part of ongoing lawsuit

by Dan Margolies

HCA Midwest Health has agreed to pay the Health Care Foundation of Greater Kansas City $15 million to settle part of a long-running dispute with the foundation over HCA’s charitable obligations.

The agreement is the latest development in a lawsuit filed in 2009 by the foundation, which was created from the proceeds of the sale of Health Midwest to HCA in 2003.

Last April, HCA agreed to pay $77 million to the foundation, on top of nearly $162 million that a judge ordered it to pay in 2013. The latest settlement brings the total to $254 million.

The lawsuit concerns whether HCA met its contractual obligations following its purchase of Health Midwest to provide at least $653 million in charity and uncompensated care over 10 years.

The latest settlement does not affect an ongoing dispute between HCA and the foundation over whether HCA met its capital expenditure obligations.

“The foundation is pleased to have reached this settlement and will use the proceeds to continue our mission of improving health for the uninsured and underserved in the Kansas City community,” Kenneth Southwick, chairman of the foundation’s board, said in a news release about the settlement.

M.L. Lagarde, president and CEO of HCA Midwest Health, said in the release that while the company believed it had “fully satisfied and exceeded its charity and uncompensated care obligations,” the settlement “provides additional funds for the benefit of the health care needs of Kansas City’s uninsured and underserved population.”

HCA is the largest for-profit hospital chain in the country.

The company paid $1.3 billion in 2003 to acquire Menorah Medical Center, Research Medical Center, Overland Park Regional Medical Center and other nonprofit health care facilities owned by Health Midwest.

Proceeds of the sale were used to set up the Health Care Foundation of Greater Kansas City on the Missouri side of the state line and the REACH Healthcare Foundation on the Kansas side.

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